ACO – Another Three Letters in the Alphabet Soup

There is a popular children’s song called, “Alphabet Soup,” that I’m told is quite the tune. Despite the song’s objectives to teach kids about the alphabet, the song’s chorus encourages children to combine letters in order to produce words, and ultimately ideas. The sing-song chorus goes a little something like this:

“Grab yourself a letter, throw it in a pot. Stir it up, stew it up and serve it real hot. Read it while you eat it. Feed the whole troop. Can’t get enough of that Alphabet Soup.”

Let’s take a moment to reflect on some fundamentals: Letters make words and words represent ideas. Sometimes though, ideas are so complex that words no longer describe; instead, they only represent a vague concept of something beyond that language. Education plays a role in this, because it is through education that we come to understand “context,” which is where we mentally group relative concepts to form meaning and gain understanding.

Using letters to represent large concepts happens all the time, particularly in health care. In our health system, there are many moving parts and many demanding complexities. Therefore, understanding context is instrumental for those invested in the industry. For example, to the general public the following letters mean nothing. To others, they are a part of daily life:

Keeping track of these acronyms can be challenging, particularly when there are replacements or additions to what has already being used.

Lucky for us, there’s been a good deal of discussion around a new acronym in health care: ACO.

So, what is an ACO?

ACO stands for, “accountable care organization,” which is a network of physicians and other health care providers that agree to share responsibility for the care of a group of individuals with the intent to preserve health and promote healthy living.

National Public Radio recently published an article titled, “Accountable Care Organizations, Explained,” that explores the proposed ACO model in light of health care reform discussions. The article quotes Harold Miller, president and CEO of the Network for Regional Healthcare Improvement and executive direct of the Center for Healthcare Quality & Payment Reform in Pittsburgh, who describes the ACO function as similar to manufacturing a television.

A TV manufacturer like Sony may contract with many suppliers to build sets. Like Sony does for TVs, Miller says, an ACO would bring together the different component parts of care for the patient – primary care, specialists, hospitals, home health care, etc. – and ensure that all of the “parts work well together.”

The problem today, Miller says, is that patients are getting each part of their health care separately. “People want to buy individual circuit boards, not a whole TV,” he says. “If we can show them that the TV works better, maybe they’ll buy it,” rather than assembling a patchwork of services themselves. “But ACOs will need to prove that the overall health care product they’re creating does work better and costs less in order to encourage patients and payers to buy it.”

It is important to mention that ACO objectives are not solely fueled by wellness. There is a payment and financial benefit to these organizations. Currently, the United States health care system is based upon a “fee-for-service” system that charges patients and insurance companies based upon each health care procedure completed or medication used.

In the ACO model instead, the designated group of physicians are responsible for the quality, cost and overall care of a community. It would allow physicians and health system leaders to plan and budget health care expenses for the community, ultimately lowering overall costs as well as redundant patient testing. This model for care is particularly favorable for communities who rely heavily upon Medicare and Medicaid to fund health care.

The traditional fee-for-service system is considered as being unsustainable, which is why many health care leaders are embracing the ACO model of service.

What impact will ACOs have on health care?

There are mixed opinions on what ACOs will offer our current health system. To some, ACOs represent “managed care,” a term and concept that induces anxiety and apprehension. From this perspective, ACOs remove the individual responsibility of managing one’s health and assign that to the group of physicians, whom may or may not have the patients’ best interest in mind (even if they should) when making decisions.

In an article titled, “ACOs and Community Hubs of Wellness & Health,” health IT thought leader Kent Bottles discusses a differing perspective supporting the ACO initiative. In his article, Kent describes ACOs as being community centers to promote healthy living and envisions these facilities to sit at the center of communities and provide additional amenities similar to current community park districts.

Are there current examples of ACOs?

It can be agreed, however, that the ACO model would be a dramatic change from our current health system. Currently there are no examples of ACOs, however, the CMS is currently exploring guidelines expected to be available in the coming months for facilities looking to adopt the ACO model.

Until there is more information available, the ACOs are another three letters for your alphabet soup.

“Grab yourself a letter, throw it in a pot. Stir it up, stew it up and serve it real hot. Read it while you eat it. Feed the whole troop. Can’t get enough of that Alphabet Soup.”

Erica Olenski

Erica V. Olenski currently serves as an account executive at Corepoint Health. She has focused her research and professional experience in healthcare communications and new media opportunities within the healthcare IT industry.
Erica is a leader in the health IT social media community, serving as the VP of Communications for the HIMSS DFW Board of Directors for 2011-2012, and was the founder of the #HITsm (healthcare IT social media) tweet chat held each Friday at 11 a.m. CT. (For more information on the #HITsm chat, visit: http://ow.ly/536eu)
For updates on healthcare IT and social media, follow her on Twitter: @TheGr8Chalupa.

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